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Deepwater eyes 'seamless' move into 210MW project after South Fork

Deepwater Wind intends to move immediately into construction of a 210MW offshore wind farm after building its 90MW South Fork project, delivering power from both wind farms to New York’s Long Island, chief executive Jeffrey Grybowski tells Recharge.

Deepwater made history last year by becoming the first developer to bring an offshore wind farm into operation in US waters, and it followed up last month by securing a power-purchase agreement with the Long Island Power Authority (LIPA) for its 90MW South Fork project – meaning it will likely be able to claim the country’s second offshore project as well.

Beyond South Fork, due to enter offshore construction around 2020 within Deepwater’s 1GW “One” zone south of Massachusetts and Rhode Island, the developer has another 210MW project in the same zone under consideration by LIPA in a separate tender being held for renewables projects.

Deepwater is hoping the results of LIPA's tender will be announced later this year, and it will walk away with an off-take contract for another 210MW of capacity, further solidifying its lead in the fledgling US offshore market.

“If we’re selected we’ll be building a 90MW wind farm and then a separate but related 210MW wind farm, essentially an expansion of that first project,” Grybowski says.

“They’re separate projects but the goal would be to stage them so we can take advantage of efficiencies – building one and then moving straight into the second.”

From a logistical perspective, staggering the construction windows of the two projects makes sense, he says. “I’m not sure we have the port infrastructure locally to be able to easily build 300MW all at once in the region.”

“But it’s very viable to build the two projects sequentially, and obviously there would be some overlap.”

Deepwater previously bid 210MW of offshore capacity in its “One” zone into a tender held by LIPA in 2014, only to lose to cheaper solar power. Since then, however, the cost of offshore wind has fallen, and the Rhode Island-based developer now has its operating 30MW Block Island project to point to as a demonstration of the technology’s commercial viability.

Furthermore, New York state has thrown its weight behind offshore wind in a significant way over the past year, with Deepwater securing the PPA for South Fork after Governor Andrew Cuomo publicly encouraged LIPA to reach terms with the developer.

All those factors may increase the likelihood of Deepwater prevailing with its 210MW follow-on project this time round.

Deepwater Wind, whose largest owner is US hedge fund D.E. Shaw, won the rights to its 1GW zone in 2013, topping just two other bidders with its winning bid of $3.8m.

In hindsight, Deepwater’s bid for the zone looks like something of a masterstroke. For comparison, Norway’s Statoil paid $42.5m last year for a 1GW zone of its own off the coast of New York.

The location of the "One" zone would allow Deepwater to sell offshore wind power into a number of number of New England states, including Massachusetts, which will soon kick off its first offshore wind tender, and New York, which sees offshore wind playing a substantial role in its 50% renewables future.

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Deepwater eyes 'seamless' move into 210MW project after South Fork

Deepwater Wind intends to move immediately into construction of a 210MW offshore wind farm after building its 90MW South Fork project, delivering power from both wind farms to New York’s Long Island, chief executive Jeffrey Grybowski tells Recharge.

Deepwater made history last year by becoming the first developer to bring an offshore wind farm into operation in US waters, and it followed up last month by securing a power-purchase agreement with the Long Island Power Authority (LIPA) for its 90MW South Fork project – meaning it will likely be able to claim the country’s second offshore project as well.

Beyond South Fork, due to enter offshore construction around 2020 within Deepwater’s 1GW “One” zone south of Massachusetts and Rhode Island, the developer has another 210MW project in the same zone under consideration by LIPA in a separate tender being held for renewables projects.

Deepwater is hoping the results of LIPA's tender will be announced later this year, and it will walk away with an off-take contract for another 210MW of capacity, further solidifying its lead in the fledgling US offshore market.

“If we’re selected we’ll be building a 90MW wind farm and then a separate but related 210MW wind farm, essentially an expansion of that first project,” Grybowski says.

“They’re separate projects but the goal would be to stage them so we can take advantage of efficiencies – building one and then moving straight into the second.”

From a logistical perspective, staggering the construction windows of the two projects makes sense, he says. “I’m not sure we have the port infrastructure locally to be able to easily build 300MW all at once in the region.”

“But it’s very viable to build the two projects sequentially, and obviously there would be some overlap.”

Deepwater previously bid 210MW of offshore capacity in its “One” zone into a tender held by LIPA in 2014, only to lose to cheaper solar power. Since then, however, the cost of offshore wind has fallen, and the Rhode Island-based developer now has its operating 30MW Block Island project to point to as a demonstration of the technology’s commercial viability.

Furthermore, New York state has thrown its weight behind offshore wind in a significant way over the past year, with Deepwater securing the PPA for South Fork after Governor Andrew Cuomo publicly encouraged LIPA to reach terms with the developer.

All those factors may increase the likelihood of Deepwater prevailing with its 210MW follow-on project this time round.

Deepwater Wind, whose largest owner is US hedge fund D.E. Shaw, won the rights to its 1GW zone in 2013, topping just two other bidders with its winning bid of $3.8m.

In hindsight, Deepwater’s bid for the zone looks like something of a masterstroke. For comparison, Norway’s Statoil paid $42.5m last year for a 1GW zone of its own off the coast of New York.

The location of the "One" zone would allow Deepwater to sell offshore wind power into a number of number of New England states, including Massachusetts, which will soon kick off its first offshore wind tender, and New York, which sees offshore wind playing a substantial role in its 50% renewables future.